"Snowmageddon" is over, now waiting for "Snowzilla" to arrive

by Dan Krell © 2010

The good news is that the historic blizzard of 2010 (A.K.A. "Snowmageddon") is now officially over. The unfortunate news is that the weather service issued additional snow amounts of 12" to 24" due to begin tomorrow evening. Forget the recession, this years snow has probably affected more home buyers than anything else. Since open houses and home showings are postponed for better weather, enjoy these photos from a blizzard of many names.
Snowing...
Early morning about 6am, another eight to ten hours to go!

Still snowing...
Here comes "Mr. Plow"... but still snowingSnow eventially stops leaving this...

Your future home

by Dan Krell © 2010

The “Jetson’s” lived in a futuristic home that combined science fiction with a hedonistic vision of immediate gratification. Even futuristic home exhibits featured at past World’s Fairs seemed like sci-fi movie sets. Although some interesting devices were featured in those futuristic homes (such as the Jetson’s Rosie the robot or their Food-a-Rac-a-Cycle), some have actually made their way into our homes; wall mounted wide screen televisions and microwave cooking are but a couple of the conveniences that evolved from “futuristic” technological advances.



Although futuristic devices are always welcome to make life easier and more fun, the evolution of the home will not occur because of the conveniences that are contained within. Rather, the future home will evolve from changes in living space and lifestyle; location, home size and interior space will be the focus of future home architecture and development.

Location has always been a main consideration when buying a home. The recent real estate market decline confirmed the higher demand for homes located in or in close proximity to major population and employment centers than homes located in “suburbia.” One of the many reasons you may buy a home closer to your job is to decrease your commute. The National Association of Realtors 2009 Profile of Home Buyers and Sellers (Realtor.org) indicated that commuting costs are a factor when choosing a neighborhood. Since the cost of commuting is becoming more expensive (in terms of money and time), home buyers as well as home builders will look to the convenience of living “close in,” or at least close to the conveyances (such as metro) that will take you to work.

Your next home may be smaller than you think. The NAR 2009 Profile of Home Buyers and Sellers indicated that size matters when it comes to a home; the average size of a home purchased in 2009 was about 1,800 sf. Although the average home size has almost doubled since 1950 (to about 2,300 sf), the trend towards increasing home size has most likely plateaued due to factors that balance the home’s cost, affordability, and the desire to be in a “close in” neighborhood.

Your lifestyle has most likely changed in the last twenty years, just as the average American’s lifestyle has changed – and will continue to change. Changing lifestyles have altered many things in our lives, including how we use our homes. One example is how we entertain; long gone are the “formal” tea parties in the sitting or living room, present-day home owners plan informal gatherings instead (usually ending in the kitchen). Homes that will offer open “flexible” spaces, which are multi-purpose and can be modified by our personal lifestyles, will provide a feeling of being in a much larger home. Additionally, kitchen spaces will blend in with these multipurpose spaces adding to the flexibility and creating the feel of having a large kitchen space. The rooms can be used for entertainment and work centers, while allowing for informal dining and impromptu entertaining.

Your home of tomorrow may not be the futuristic vision that you dreamed about watching Saturday morning cartoons. However, much like current home owners who are transforming their older, “close-in” homes into contemporary “open” spaces, it will be a blend of utilitarianism and style that will be convenient to your office.

This article is not intended to provide nor should it be relied upon for legal and financial advice. This article was originally published in the Montgomery County Sentinel the week of February 1, 2010. Using this article without permission is a violation of copyright laws. Copyright © 2010 Dan Krell

Are you selling a home or a contract?

by Dan Krell © 2010

In a recent home showing, the listing agent remarked that the seller is the “contract seller.” As it turned out, the seller of the home was not on title, but rather had a contract on the home and wanted to sell the contract. The listing agent, trying to explain the situation as best as he could, stated that the seller's contract gave hime equity in title which allows him to sell the home.

I had to wonder where this agent received his real estate license because, as a title attorney confirmed, equity in title does not permit one to sell a home they do not yet own. Never mind the fact that our local MLS (Metropolitan Regional Information Systems, Inc.; MRIS.com) requires listed properties to be listed by the legal owner of the property. So what are these guys trying to do?

The number of home flipping transactions are increasing as the market recovers. Home flipping received a lot of bad press in the 1990’s when fraud was prevalent in such transactions. Flipping a home per se is not illegal, it is fraud and other irregularities that raise eye brows and get the attention of local (and sometimes national) authorities.

Not all property flips involve fraud and deception. During the heyday of the sellers’ market earlier this decade, real estate investors capitalized on the frenzy of home buyers eager to own a home in the seemingly never ending appreciating market by quickly flipping properties. Of course, many real estate speculators lost a lot of money as the market receded.

A flipping technique that has been thought to be dubious by some and now making a comeback is the simultaneous closing (or double closing); a similar term/technique is selling the contract. Rather than take ownership of a property and obtain the title to a home, investors most likely resort to the double close or contract sale to save on transfer, property, and other taxes.

A local attorney (requesting not to be named) trying to close such a deal was contacted by the buyer's lender Fraud Investigation Department. Although he felt there was nothing wrong with the deal and he was not withholding any information, the deal was denied by the buyer’s lender. Although the buyer qualified for the loan, the lender’s Fraud Investigation Department nixed the deal. Growing concerns of stolen homes where homes are sold without the knowledge of the legal owner are raising additional red flags.

To avoid such deals, FHA (among many conventional lenders) require that the title to be “seasoned” (the owner must be on title for a required period of time) before they will lend on the property. Finding a lender to finance a simultaneous closing or contract sale is often difficult.

Although the “contract seller” of the home I showed was most likely legitimate, it reminded me that even seasoned agents need to be on their toes. Buying a home is an investment of time and money, so don’t be afraid to exercise due diligence; asking who the seller is and why they are selling the home is often a good place to start.

This article is not intended to provide nor should it be relied upon for legal and financial advice. Using this article without permission is a violation of copyright laws. Copyright © 2010 Dan Krell

Transfer tax controversy brews in Maryland Counties

by Dan Krell © 2010

Most real estate issues usually do not grab people’s attention - unless they are the ones affected. Eminent domain is a prime example; those affected usually become embroiled in the controversy. One current issue that you may have heard (although you may not have become fully aware) of is the transfer tax controversy that’s brewing in Montgomery and Anne Arundel Counties. The anticipated opinion on the controversy from the Maryland Attorney General may have lasting and widespread consequences on how transfer tax is calculated in this state.

The controversy surrounds the decision from Montgomery and Anne Arundel Counties to collect transfer tax on the “forgiven” mortgage amounts in a short sale. At face value, the policy of collecting transfer tax on the unpaid portion of a short sale appears to be a way for the counties to compensate for their declining tax base; however the fundamental method of calculating state and county transfer tax may be more the issue. On January 12th, however, Montgomery County put “a hold” on the collection of transfer tax of the “forgiven” mortgage amount until the Maryland Attorney General issues his opinion.

The “forgiven” mortgage amount is the amount that the seller’s lender agrees to not collect at the settlement of a short sale. However, this amount is not literally forgiven as the lender typically either considers it income and issues a 1099 to the seller or pursues payment through a deficiency judgment against the seller. Since part of the requirement for a short sale is usually to provide evidence of a hardship, some critics have argued that the collection of transfer tax on “forgiven” mortgage amounts to be punitive.

The collection of transfer tax on forgiven mortgage amounts should not be confused with “nominal consideration” rules that are used in some jurisdictions around the country (including Washington, DC). “Nominal consideration” rules typically calculate additional transfer tax when the sales price is less than the assessed value. In Washington, DC, a transaction is considered to be of “nominal consideration” when the sales price is less than 30% of the assessed value.

Title 13 of the Tax-Property section of the Code of Maryland (COMAR) discusses the collection of transfer tax by the State and counties, as well as tax rates and possible exemptions. COMAR discusses various ways in which transfer taxes are calculated and collected; for example tax is calculated on the “consideration payable for the instrument of writing”; and the tax is “imposed on the instrument of writing.”

Some may have mistakenly thought that consideration is only the sales price and the instrument in writing is only the deed; however, others have argued that consideration also includes additional amounts involved in a transaction (such as assumed loans) and instruments in writing to also include deeds of trust. I am not an attorney and I am not attempting to practice or interpret law, but it appears that clarification from the Attorney General has become necessary in interpreting “consideration” and “instruments of writing” when calculating transfer tax in today’s market.

You might consider the collection of forgiven mortgage amounts another sign of a depreciated real estate market. However, the future of transfer tax calculation and collection (at least locally) is sure to be affected by the highly anticipated opinion of Attorney General Gansler.

This article is not intended to provide nor should it be relied upon for legal and financial advice. This article was originally published in the Montgomery County Sentinel the week of January 25, 2010. Using this this article without permission is a violation of copyright laws. Copyright © 2010 Dan Krell



Update---Attorney General's Opinion

What's more effective, a marketing strategy or a marketing plan?

Successful home sales begin with a marketing strategy and plan.

by Dan Krell © 2010

Does your listing agent have a marketing plan or a marketing strategy? Ok, it was a trick question. Actually, your agent should have both! Long gone are the days of receiving ten offers a day after the sign goes in the ground. In order to get an edge over the competing neighborhood listings these days, successful listing agents need to have an understanding of planning and strategy concepts, as well as their application.

A marketing strategy is the process of positioning your home; in other words your agent researches and compares data from the neighborhood and your home, as well as comparison data from other homes in the neighborhood and extended market area. Comparisons are made between your home’s characteristics and style to the neighborhood to determine similarities and differences. Once the data is compiled and evaluated, trends begin to appear that brings your home to life; your home begins to have a personality of its own.

Your marketing strategy should also include price. Due to recent market fluctuations, price is a major concern for home sellers. Market instability can reveal erroneous data which may cause you to either set your price too high or too low. Nothing can ruin an effective marketing strategy more than over pricing your home, which can severely limit the number of home buyer viewings; while listing too low can result in selling for too little. Listing and sales price data reveal trends that will assist you in setting an initial list price (as well as subsequent price adjustments).

Once your home is on the market, your agent’s marketing strategy (or lack thereof) will determine how home buyers and real estate agents react when thinking of your home. You should be certain that the strategy is appropriate and inclusive because re-positioning your home can be very difficult; the image that is presented to buyers and agents will be impressed forever in their minds. Additionally, word gets around the area fairly quickly, so negative images are surely to be passed along to others who may not yet have seen your home (and ultimately may not because of the shared information).

The marketing plan can be considered a road map in the application of the marketing strategy. It goes without saying that everyone’s listing is on the internet these days, as well as most agents advertising in the local papers. But as any marketing major might tell you it’s not the ad itself, but what the ad says. So, having ads, placements, and flyers generally do not get the attention of home buyers on their own, rather it’s the strategy that is being expressed that grabs home buyers’ attention. Additional consideration should be given to where and when ads about your home will be placed.

The marketing plan should not stop at an internet and print advertisement. The plan should include when open houses should be held (including what to say to visitors), and other means of reaching out to home buyers (such as post cards and broker opens).

Although marketing strategies and plans are vastly different, they are related. The marketing strategy determines the positioning of your home; while the marketing plan is the map that is followed to help home buyers find your home. Without a strategy and plan, your home sale will have to rely on sheer luck.

This article is not intended to provide nor should it be relied upon for legal and financial advice. This article was originally published in the Montgomery County Sentinel the week of January 18, 2010. Using this this article without permission is a violation of copyright laws. Copyright © 2010 Dan Krell

Shortcomings of the broker price opinion

by Dan Krell © 2010

A broker price opinion (also known as a BPO) is not an appraisal, nor is it a substitute for an appraisal. The BPO is the lender’s way of getting a “snap shot” of the subject market area. A BPO (not unlike a CMA) is an analysis to assist a buyer or seller in deciding a home’s offering, or listing price. BPOs have been used for many years, and for various reasons that range from quality control to making decisions on mortgage portfolios and loss mitigation.

A BPO is not a perfect tool and is limited to the information provided as well as the people involved in the process. The shortcomings that are inherent in the BPO process begin with the lender that orders the BPO and is extended to the BPO company that “farms” the BPO out to real estate agents, as well as to the agent that completes them.

The problem first begins with the lender who is usually not in the same market area as the subject property. Seeking a way to get a snapshot of a home’s “value,” the lender will pay for a broker price opinion. The lender’s employees who order and use the BPO is sometimes mistaken to think that they are getting a report that will say what the home will sell for, when actually the BPO is just an offering of possible listing prices based on area comparables.

The shortcomings of the BPO are extended to the BPO company (third party) that hires the real estate agents to provide the reports. BPO reports are typically completed over the internet these days using electronic forms that can limit the amount of information that is provided. A typical BPO report requires a limited specific number of comps (listing and sold comps), regardless of the availability of neighborhood comps; the report may have to exclude additional available comps while sometimes use comps that are hardly comparable to the subject property. The online forms used to complete BPOs also limit the amount of information that is input; which can limit the actual market data and conditions that is sought from the lender.

Once submitted, the BPO typically undergoes a review for “quality.” BPOs are usually reviewed for procedural standards as well as comp quality. Interestingly, quality reviews are usually conducted by reviewers not familiar with the subject market area; it is quite possible that some quality reviews are not only conducted in another state, but in another country. Ironically, quality and substance is sometimes sacrificed for quantity or a “specific result.” (Past agent complaints, posted on agent bulletin boards, indicate that they realize some of their reports are altered after submission by someone other than themselves).

The ultimate shortcoming of the BPO stems from the real estate agents who complete the BPO. In recent years, with the explosion of short sales and foreclosures, there has been an increase in the need for more agents to complete BPOs. Some agents seek out BPOs because they are under the impression that they will get an REO listing, other agents seek out BPOs because they solely rely on the BPO business as income, while others just take on BPOs to supplement their brokerage income.

Time and care is necessary to complete a quality BPOs. Many real estate agents performing BPOs have little or no training in conducting BPOs; many agents do not have the expertise to provide a CMA to a home owner let alone completing a BPO. What may be more alarming is that some agents boast about the number of BPOs they complete per week (I recall one agent boasting that they complete over 100 per week!).

“Turn’em and burn’em” should not be the motto of anyone in this process. Because quality BPOs are useful and needed, the future of BPOs may rely on local licensing or registration which can ensure competence of those performing BPOs as well as maintaining standards of those who use them.

This article is not intended to provide nor should it be relied upon for legal and financial advice. Using this this article without permission is a violation of copyright laws. Copyright © 2010 Dan Krell

How to dispute credit report errors

by Dan Krell © 2010

Recently I told you about the growing importance of your credit report and why you need to ensure it’s accurate. The accuracy of your credit report is more important today than it ever was, not just because mortgage lenders have tightened credit qualifying guidelines, but also because of the growing reliance on credit reports from employers, insurers and other creditors to get information about you.

It is not unusual to find discrepancies or incomplete information within the report, including old credit accounts and outdated personal history. Errors in personal information and credit history sometimes occur due to transposed social security numbers and confusing people with similar names (including confusing the Jr and Sr name suffix). The Fair Credit Reporting Act (FTC.gov) requires accurate and complete data about to be reported by credit reporting companies and those providing information about you.

The first step in correcting errors is to review your report. As I have previously described, you have the opportunity to receive a free credit report from each of the three credit repositories (other factors may allow you to receive additional free reports). Additionally, since fraud and identity theft is a serious threat to your credit history and a growing concern among law enforcement; a regular review of your credit report is a good idea even if you have previously deemed the information accurate. You can contact each of the three credit repositories directly Equifax (equifax.com), Experian (experian.com), and Trans Union (www.transunion.com), or you can visit annualcreditreport.com (a central credit service created by the three credit repositories). The Office of the Maryland Attorney General cautions people when entering website addresses; when entering website addresses, accuracy is important because of the many similar commercial websites that charge for similar services.

If you determine that errors exist in your report, you must notify the credit reporting company in writing to dispute the information. To document your letter delivery, the Federal Trade Commission suggests that your letter be sent via certified mail with return receipt requested. Besides showing your complete name and address, your dispute letter should clearly identify all disputed items with an explanation of the facts as to why the information is disputed along with a request to remove the information. Additionally, your dispute letter should contain the report with disputed items circled, as well as any copy of supporting material to defend your claim.

The credit reporting company has thirty days to investigate the disputed items. The credit reporting company will forward your dispute, along with any supporting materials, to the provider of the disputed information to initiate an investigation of their own. If the disputed information is found to be inaccurate, then the provider must report the corrected accurate data to all three credit repositories. The credit reporting company must provide you notice of the outcome of the investigation along with an updated report showing any changes.

Sometimes credit reporting companies will determine a dispute is “frivolous” (often when insufficient information is provided) and will terminate an investigation. If your dispute was determined to be “frivolous,” the credit reporting company must notify you along with the reasons for this determination.

Additional and updated credit report dispute resolution information as well as resources are offered by the Federal Trade Commission (ftc.gov/bcp/edu/pubs/consumer/credit/cre21.shtm), and the Office of the Maryland Attorney General (www.oag.state.md.us/consumer/edge121.htm).

This article is not intended to provide nor should it be relied upon for legal and financial advice. This article was originally published in the Montgomery County Sentinel the week of January 11, 2010. Using this this article without permission is a violation of copyright laws. Copyright © 2010 Dan Krell

Coping with the stress of the real estate transaction

by Dan Krell © 2010

Unless you are under the care of a psychiatrist prescribing you valium, “stress free” is not something that comes to mind when describing real estate. According to the American Institute of Stress (stress.org), stress is subjective and can originate from negative and positive experiences.

On the “Holmes-Rahe Social Readjustment Rating Scale” otherwise known as the Holmes and Rahe Stress Scale (Holmes & Rahe 1967), having a mortgage over $10,000 rates 31 (just above being foreclosed upon) and moving is rated as 20. This commonly used stress scale (which rates life events to determine risk of illness) is cumulative, so the rating for buying a home is at least 51. Your stress level obviously increases when you add in other life stressors such as (but not limited to): getting divorced (73); getting married (50); having a baby (39); changing careers (36).

The reason why buying a home may rate so high on the Stress Scale is that, unlike other transactions, buying (and selling) a home is a large emotional investment! Gordon Gekko, from Oliver Stone’s Wall Street, was on to something when he said, “don’t get emotional [over stock], it clouds your judgment.” Emotions often become amplified when stress increases and can interfere with judgment.

Although most real estate agents don’t understand stress (what it is or how it’s reduced), it does not stop them from lecturing and blogging about “reducing stress” during the home buying or selling process. Being prepared and dividing the buying/selling process into segments is common advice and makes sense. This guidance often helps buyers and sellers feel a sense of “control” by understanding what to expect. However, the wonderful thing about real estate is that every transaction presents a new set of personalities, conditions, and (sometimes) problems. Reactions among buyers and sellers, as well as real estate agents, vary depending on their personalities and life circumstances. So no matter how much you plan, prepare, and visualize what it may be like, stress can be produced just by going through the process (created by both positive and negative feelings).

For some, being prepared is enough to help them anticipate and deal with most circumstances that may arise; while for others, the act of preparation may actually increase stress. Emotional factors, often based on needs and fears, can play a key role in your stress levels. Sometimes your needs are beyond your control and can increase your stress level, such as the need to stick to stringent timelines. And sometimes your needs can adapt and change which can mitigates your stress, such as finding the “perfect home.”

Fears about the outcome of the transaction can increase your stress, especially if you’re a first time home buyer. Common buyer fears include mortgage approvals and rising interest rates; sometimes buyers fear that the home inspection may reveal problems with the home. Common home seller fears include the home buyer’s qualifications and the ability to consummate the sale.

Good real estate agents know how to address the needs and fears of the real estate transaction to keep stress levels in check. Regardless, some people may turn to self help, “pop” or common stress reduction techniques (such as meditation); and if the stress is overwhelming, it wouldn’t hurt consulting with your physician or a qualified mental health professional - especially if you’re already stressed by your job, family and other life stress.

This article is not intended to provide nor should it be relied upon for legal and financial advice. This article was originally published in the Montgomery County Sentinel the week of January 4, 2010. Permission to use this article is by written consent only. Copyright © 2010 Dan Krell

Mortgage fraud: The makings of a crime novel

by Dan Krell © 2010

Mortgage fraud is a most despicable crime. Scammers attempts to get away these types of crimes not only eats away at home owners’ equity and/or depletes lenders’ funds (as well as their investors’ money), it forces the public to pay for extensive investigations, trials and prison expenses. Sometimes, however, some crimes appear to be intriguing, not because of the crime per se, but because you want to get inside the scammer’s mind to understand their motives as portrayed by their blatant behaviors and flamboyant lifestyles. From the case files (otherwise known as press releases) of Rod J. Rosenstein, United States Attorney for the District of Maryland, the Metropolitan Money Store Case would appear to make a great follow up to Oliver Stone’s “Wall Street.”

If not for the fact the events in the case actually occurred, you might think that you might be reading the latest crime novel about the mortgage meltdown. However, seeming to be one of the most intriguing cases prosecuted this year, the Metropolitan Money Store case defrauded home owners and mortgage lenders for over $37million by asserting to offer foreclosure assistance and credit repair to home owners. The story ends with the president and the CEO recent sentencing to prison time after an extensive investigation that netted ten defendants that included an attorney, real estate agent, mortgage broker, mortgage processor, among others.

According to the press release of the US Attorney’s Office, the president of the Money Store was “Personally responsible for over $16 Million in losses to mortgage Lenders…” Additionally, U.S. Attorney Rod J. Rosenstein was quoted to say, “Joy Jackson presided over a ‘money store’ that was in the business of ripping off homeowners and mortgage lenders by submitting fraudulent paperwork to support over $37 million of loans that were never intended to be repaid”…”Instead of helping financially distressed homeowners keep their homes as promised, she secretly used the home equity to buy luxuries for herself, including furs, jewelry and over $800,000 on her wedding.”

Something like a modern day “Tin Men,” home owners (who were behind in their mortgages or in foreclosure) were directed to sign title over to third parties who acted as straw buyers to strip the equity form the homes under the guise that the money taken would bring the home owners current on their mortgages and rebuild their credit. Additional financial and investment groups were also added to expand the the conspirator's foreclosure "consulting and credit services." The equity proceeds were used for goods and services for the president and CEO of the Metropolitan Money Store including art, cars, clothing, credit card bills, homes, fur coats, furniture, airline trips, gambling expenses, jewelry, limousine services, student tuition and a luxury wedding. The conspiracy described in the US Attorney’s press releases (for individual defendants) would make Mickey Spillane jealous of not conceiving such a plot.

Selected US Attorney Press Releases regarding the Metropolitan Money Store:
Press Release November 16, 2009
Press Release December 7, 2009
Press Release October 5, 2009
Press Release September 14, 2009
Press Release May 18, 2009

The good news is that the conspirators in this case were brought to justice, like other mortgage fraud cases, with prison time. Unfortunately, the bad news is that consumers continue to be deceived and defrauded by con artists, even though government warnings and public service announcements alert the public to be cautious of foreclosure rescue scams.

This article is not intended to provide nor should it be relied upon for legal and financial advice. Permission to use this article is by written consent only. Copyright © 2010 Dan Krell

Things we'll be talking about in 2010

by Dan Krell © 2009

2009 was a year when many home owners lost their homes to foreclosure, while other home owners could not move due to their depreciated home values. Let’s also remember that 2009 was also the time when many home buyers took advantage of home buyer tax credits and reduced prices from distressed properties (which helped boost home sales statistics).

As much as it felt that 2009 was the tear down year for the real estate industry, 2010 is promising to be a re-building year; the upcoming year will lay the foundation real estate markets to come. So, you might ask, “how will things be different?” This is what we may expect to see in 2010: a change in home buyer attitude; rising interest rates; and “Cash for Caulkers.”

More home buyers will be searching for homes in 2010. However, continued changes in mortgage underwriting guidelines will most likely limit the number of qualified home buyers. Mortgage underwriting guidelines have been tightening through 2009 and will continue into 2010. The trend of shrinking the pool of qualified home buyers due to mortgage guidelines requiring increased down payments, higher credit scores, and reduced debt ratios will most likely continue as FHA’s new underwriting guidelines are anticipated in 2010. New FHA guidelines are expected to increase the minimum down payment to 5% and restrict debt ratios below 45% (for FHA mortgages).

Additionally, the current home buyer incentives are likely to sunset without any further extension; it is doubtful that home buyer credits will continue in its current form. As a result of having more “skin in the game,” it is possible that home buyers will be more conscientious during the home buying process; home buyers will take more time and be more discerning in their home search.

Mortgage interest rates are likely to increase through 2010. Having been relatively close to historic lows for nearly a decade, mortgage rates will most likely steadily climb as current Federal Reserve programs are set to end (already evidenced by a consecutive 4 week rise in the average 30-year fixed rate as indicated by Freddie Mac’s Weekly Primary Mortgage Survey). The Fed’s current purchase program of mortgage backed securities and agency debt, that was meant to assist the housing market and facilitate mortgage lending, is committed through the end of the first quarter of 2010. The Fed has already begun slowing the pace of these purchases, so as to ease the transition in the marketplace (www.federalreserve.gov/newsevents/press/monetary/20091216a.htm).

The most anticipated news for 2010 is the “cash for caulkers” program, also known as the “Home Star” program. Although many have speculated about the program and its guidelines, legislation has yet to be passed. President Obama, in a speech given at the Brookings Institute on December 8th, called on Congress “…to consider a new program to provide incentives for consumers who retrofit their homes to become more energy-efficient…”, and to emphasize passing of such as legislation (WhiteHouse.gov). The plan is supposed to offer tax incentives to home owners for increasing home energy efficiency through home energy audits, system replacements, and weatherization; however, the final legislation (if any) may have variants of the current proposal.

In the near future it may seem as if home owners may be talking more about retro-fitting their homes than moving, while more home buyers will complain of the mortgage process. Regardless, everyone is looking forward with optimism to 2010.

This article is not intended to provide nor should it be relied upon for legal and financial advice. This article was originally published in the Montgomery County Sentinel the week of December 28, 2009. Permission to use this article is by written consent only. Copyright © 2009 Dan Krell